Assignment Problem: In 2013, the online travel company priceline.com INC acquired KAYAK Corporation, a travel meta-search website. Amounts paid related to the acquisition were as follows: (dollars in thousands)
Cash paid to former shareholder of KAYAK 521,443
Fair value of 1,522,000 shares of .08 par 1,282,334 common stock issued to former shareholders of KAYAK
Fair value of assumed vested KAYAK stock options, related to 264,423 pre-combination service
Fair value of unvested KAYAK stock options related to post- 57,400 combination service
Stock issuance cost 1,200
Professional consulting fees 8,500
The fair value of identifiable assets acquired and liabilities are listed below:
Current assets 322,000
Trade names 496,000
Supply and distribution agreements 302,000
Technology 73,000
Other long-term assets 11,700
Deferred tax liabilities -326,000
Other liabilities -42,800
Required:
Problem 1: Calculate the acquisition cost for KAYAK. Calculate the amount of acquisition expense reported on priceline income statement in 2013
Problem 2: Calculate priceline net credit to additional paid-in-capital for this acquisition. Round amounts to the nearest thousand if necessary.
Problem 3: Calculate the amount of goodwill recognized for this acquisition?
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